Pfizer Renewed Its Bid for AstraZeneca

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... been been been been been ... good morning this is MoneyBeat I am Paul vignette we start one to ... start the week the markets are starting in the green ... Dow Jones industrial average up on the thirty points ... separate the offer goes down a hundred forty on Friday the Nasdaq up a little less than one percent ... the Essen P five hundred up twenty seven percent eighteen seventy six one thing that got the markets going this morning ... health care sector and the date by their fathers the health care sector has been for many this year ... may get all whole lot on our bodies are already one of the world's biggest pharmaceutical companies ... dangling for a one hundred billion dollars buyout ... but the U K's AstraZeneca the Journal Dana similar ok here with all the de tails ... I saw this one cost less than twenty guys got this is a pre had set a very nice ... BdB really big deal ... of Wyatt's Pfizer doing this now and what are the odds that this can happen ... well aam ... as you pointed out there's a flurry of MNA activity in the healthcare sector right now there's various reasons why Pfizer wants to do this ... including neo traditional ... notions of you know putting two companies together to make the combined entity more efficient and in some new fangled ones like ... that actually read on the styling the company to get a lower tax rate ... taking advantage of other UK rules around patent sunlight ... he talked with these covers Pfizer ... mess of company AstraZeneca massive company ... some the key products and those are a lot of household names in there that that or bag is that ... Crestor Nexium Searle well ... AstraZeneca not crazy about this deal right in and even if you look prehistoric been talking behind the scenes a little bit here and they're ... active AstraZeneca that is playing for one or more money or are they really concerned about this deal you know it's un clear that they add a new CEO freak relatively new CEO freak only new CEOs are ... overly ... anxious to do deals to sell the company made a run for a while AstraZeneca says they think they can create more value on Iran in a country this deal ... in this would be a super complicated deal that would involve a lot of Pfizer's stock and so you know the deal is even though it's billed as a thirty percent premium it's really only worth as much as Pfizer's stock is worth ... and then you add a massive where complication when you consider that Pfizer stock would need to be effectively ... aam would effectively delete the ocean to get to AstraZeneca shareholders that at the big where publication in a deal so that the number of reasons why imagine AstraZeneca's cautions that the tax issue ... it's not ... a huge part of this story ... really ... I'm in the week the way it's written right now write about all the concerns ... that the real ... kind of seemed a stake in the crawlies of the reason why they're doing this ... how big the reason is yes and it's a good point it is that's another very large layer of complication ... it would seem that's a very big part of the rationale for Pfizer which is another pretty amazing aspect of this situation to sponsor second think about Pfizer is one of the biggest bluest chip companies in this country ... two hundred billion dollar market cap storied history ... they're talking about becoming a U K company ... and in the healthcare sector to go there been a lot of deals like this that is taken place ... in the last few months in years where companies are trying to basically ... change their headquarters so they can get a lower tax rate in this is really the ultimate poster child for right ... now with the story go from fewer than the things we need to look for what we need to enter the UK has very strict takeover rules so surprises in the face of a fairly tight time frame I imagine ... to get back together to figure out whether it really was to follow through with a formal offer a lot is going to depend on that of course and also on the ... AstraZeneca shareholders the main ... part of the reason why I think Pfizer's go has gone public now is because is trying to ... put pressure on AstraZeneca and its board of the AstraZeneca shareholders of the AstraZeneca shareholders ... meaning the UK are to be key app and I cant that stuff the stuff new team to thanks ... all ... when we come back even walk to the market grind all year ... they may want to for a little bit longer Jim Browning be here to talk about it ... Tce ... welcome back to MoneyBeat were talking about a little but early lead in the Dow Jones Industrial Average picked up one hundred and thirty eight point eight four points that sounds lovely it sounds wonderful it sounds great ... keep in mind though ... was down a hundred forty points on Friday so really were going when we got nowhere and that illustrates what has been going on all year The major U S stock indexes ... yes there perched near their all-time highs but there has been grinding along there and able to break out to new highs frustrating for investors but they may need to get use to it ... at our Jim Browning joins us from Florida to explain why ... Jim how are you ... Crane later on guidance of John Shipman Wally was down there ... and it yet ... that is lovely let's talk about your column you it is for the MoneyBeat blogged ... on debt used to the grind why ... well if you look it added to the defence minister and and last year it's pretty huge and and they're couple of big reasons for that number one the Federal Reserve which is really been motor ... the stock market's gains an economic recovery since two thousand and nine ... his is gradually starting to adjust its loss in its pulling back a little bit on its stimulus ... it's lying interest rates to stop them and as ... people know ... it probably sometime next year it's going to actually start raising its base rates ... so the Federal Reserve is a little less friendly than it was before ... it's it's trying to get things back to normal and what that means is you not can have this this ... bull market in a lot more normal market in a normal market just go straight up ... and the other ... thing is corporate earnings ... earnings gains haven't settled down Ohio's not spectacular either end experts untapped ... market and people are waiting to see how strong those they write ... the worst in the world because they were saying ... the index is down the Essen P I mean they're really counts in the long view these all-time highs ... sounds pretty good but you talk about that the Fed pulling back to talk about corporate earnings ... yes the question is this good of the guests ... it did ... in general market there's no reason the market can go up it's just very unlikely we'll go all the way it has been in the last five years the last five years have been pretty exceptional ... the market has had its ... problems that almost went into a bear market in twenty eleven but ... in general compared to ... a normal period it's been much more land from last year war with the Essen P a thirty percent ... when that was the best since nineteen ninety seven million exceptionally hearing this ten expect habit and it's an all time ... what's interesting is though that ... that when stocks go down they seem to balance and a couple of reasons for that and the ... median ... a couple of them ... the first time that seems to go ... well I mean it to basic things going on is this the general belief that even though the Federal Reserve This upland global government stimulus its not to let the economy go into recession and stopped only Financial or ... its to two messed up that that that that is a very widespread view that the Federal Reserve will do what it takes to make sure that the recovery ... is going on and that means that the floor under the market ... there will be called burn Anqi will the Greenspan put it just means that people think they can count on the Fed's support market ... the thing is that there ... are even though ... you can see signs of ... of bubbles forming in the more you can see signs of excess speculative for it really has not gotten back to levels that you saw in two thousandseven in two thousand the late nineteen nineties ... it's getting up there but by a variety of measures it is not at the ... up while excesses that we seen in the past and so the result of that is ... when you don't have this while it says you also tend not to have a few Democrats to get it before and the result of those two things is that you don't get the huge declines to get this this ... up and down markets potential breaking out but is not collapsing ... I can write stuff thank you very much ... this morning we got home price index that came in looked OK was up from a month of the March numbers up from that very painful for that that sounds good but down from a year ago seven point nine percent ... to find what is going on in the market why we need some changes here what we need to find the next great group of by Sherry Allston ... a bar certified real estate attorney asks for the real estate field how Laurie things come in white ink some of the BA ... on so let's talk about the boomerang by that I know what you're on about we had a good we fight boom in a lot of investors buying real estate ... that's kind of pulling out is the isthe yields go up ... tell me that the boomerang by the boomerang buyers color really important at this point I'm because one of the things that's happening is that the influencers that were keeping the market after the last two years and really help the recovery namely low rates and those investors who after this bargain bin in foreclosures and short sales ... they're pulling back and so we're actually seeing for the first time what a real real estate market looks like now what didn't what the new normal is two and one other things it's just so striking is the absence of real buyers traditional buyers first timers I mean we're looking at ... almost two million less new households formed because that eighteen to thirty four year old when looking at half of the people who would like to buy a home ... not even applying because of the new strict standards ... people who are our move up buyers are also facing many of them are still underwater a lot of them have locked into low interest rates they wanna trade out so we're seriously having problems with buyers but here's the thank all those folks that were foreclosed and shorts all ... we have mandatory waiting periods after certain anytime ... they're able to buy again and are starting to do just that now and the really helping to prop up housing ... now I how big the trendy thing is going to be in the next couple of years I mean ... those ... those folks who ... lost her have more foreclosed by law to video ... consoles were really their fault ... however ... do was a peaking on their credit was a big thing on their finances ... hubby how much of this t c TER churning and it ... is significant and here's why poll eighty percent of those folks say that they would like to buy yet ... and normally the periods are from two to seven years depending on your exact circumstances but already we're seeing the government stepped in with new programs like FHA back to work for them exactly for the folks are talking about people who may be lost their jobs or had their hours cut back any really wasn't their fault ... though still can get into a home again as soon as the euro after a short sale and foreclosure which is really phenomenal ... and would be looking at two or three million people in the next few years doing just that and really saving our market and yet this was the devil that the question on the view off the house just a couple years ago because you couldn't afford it ... are you are you really in a position be buying a house now and should the government ... he I greatly prefer the housing market but is that the responsible thing to do to the moral hazard Kindles has ... an instant here's the thing it's really difficult to separate folks into the bucket to really was at fault who really know strategic default or versus not ... but with our new ... site tighter credit standards it makes it a little bit easier because you can get into a home nowadays under the qualified mortgage rules without the right credit for schoolwork ... without anything more than a forty three percent debt to income ratio without a decent down payment and sells really are qualifiers that were still and I'm hearing anecdotal stories from folks I know in the field to two closings which still seeing increasing demand ... in some purists possible borrowing I mean you know people it mostly because private investors are looking to land money now ... so you can find a mortgage if you will foreclose yesterday you can get a mortgage for fifteen percent with no money down from a private lender ... but it's not government money right yet still that not it's not our taxpayer backed a little dangerous I'd Jerry thank you very much ... it was ... a great thinks ... that has it come back to an easy lunch break and come back tomorrow and if the US have a great day ... 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